The journey towards financial freedom is never easy. It is usually characterized with obstacles here and there, and sometimes, the unexpected happens way before you get to where you wish to be. Unfortunately, an urgent need for cash arises when we are not financially able to handle them.
What do you do in such instances when a bank loan is way out of your reach? The majority of people, especially the salaried ones, turn to payday lenders where the borrower is expected to repay the amount in full on the pay day.
Now, what if you foresee a situation where you will have difficulties repaying the amount in full on the payday? Borrowers can now rest assured as there is a better alternative to payday loans when they are in need of emergency funds the installment loans. Firms such as Maxlend, and numerous others, offer consumers the opportunity to access emergency cash and also accord them flexible repayment plans. You get to choose how much money to take, and a repayment plan with which you are most comfortable – including the time limit.
Benefits of installment loans
Apart from the fact that this type of short-term loan requires you to pay according to the agreed-upon installments, borrowers reap many other benefits. Some of them include:
The majority of installment loan providers are in the market to respond to the emergency needs of its customers. They, therefore, process loan requests within the shortest time possible. Some even avail the cash the same day of application or the next business day. However, it may sometimes take longer because of the affordability and creditworthiness checks that the lender must perform before releasing cash to the borrower’s bank account.
Lower interest rates
With payday loans, and other forms of short-term loans, the interest rates can be quite high, or a little bit exaggerated. On the other hand, since installment loans are spread over a long time, say more than twelve months, the interest rates and the monthly payments are significantly low.
You qualify even with bad credit
The banks have strict regulations when it comes to giving out loans. Your credit rating and history must be put on the scale before a decision to lend you money is made. As such, borrowers with bad credit have difficulties or no chances of obtaining bank loans. Providers of installment loans, therefore, come in handy because of their less stringent measures. People with bad credit also qualify for these types of loans.
Irrespective of all these benefits of installment loans, you should only consider them during an emergency. Also, you should weigh the terms of repayment and determine if you can successfully repay both the principal and interest in good time.